LONDON Nov 23 British oil explorer Desire
Petroleum said the findings of a third person report
confirmed the potential of its controversial discoveries
offshore the Falklands.
The chance of commercial development at its Sea Lion complex
in the North Falkland basin was estimated to be 80 percent, the
report by energy consultancy Senergy found, although it was a
much lower 25 percent for the gas condensate discovery at its
"This competent person's report confirms our view that the
Desire licences have excellent remaining exploration potential,"
Desire's Chairman Stephen Phipps said on Friday.
Oil exploration by British companies in the area has sparked
anger in Argentina, which claims sovereignty over the islands it
knows as the Malvinas. It has called the drilling there
'illicit' and threatened legal action.
However, while many investors have shrugged off the
geopolitical risk, bumping up the company valuations, some
analysts have questioned the likely chance of commercial success
of the finds, particularly given the high costs of extraction.
Gas condensate, which has also been found offshore the
Falklands by Borders & Southern and Falkland Oil & Gas
is especially tricky to extract and transport.
Desire said it now had 41 oil prospects and 4 gas prospects,
12 of which had best case prospective resources of over 100
million barrels of stock tank oil.
The company's priority was to attract further investment,
Fellow explorer Rockhopper signed up Premier Oil
earlier this year to help it fund the costs of
developing its own discovery at Sea Lion.